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The U.S. Securities and Exchange Commission (SEC) has agreed to postpone the civil trial against Terraform Labs and co-founder Do Kwon, who are accused of orchestrating a $40 billion cryptocurrency fraud. The delay aims to facilitate Kwon’s extradition and his attendance at the trial.

In a filing on Monday in a Manhattan federal court, the SEC justified a “modest” adjournment of the Jan. 29 trial based on Kwon’s expressed desire to attend, his agreement to extradition from Montenegro, and the possibility of his presence in the United States by mid-March.

The SEC opposed separate trials for Terraform and Kwon, asserting that the cases were essentially identical, and holding two trials would unnecessarily require whistleblowers and ordinary retail investors to testify twice.

The decision on moving the trial date rests with U.S. District Judge Jed Rakoff. The SEC proposed April 15 as the new date to accommodate scheduling conflicts.

Kwon’s lawyer had initially sought a delay until at least March 18, and on Monday confirmed that further adjournments would not be pursued even if Kwon couldn’t attend on the new date.

The case revolves around the collapse of TerraUSD, a “stablecoin” designed to maintain a constant $1 price, and Luna, a more traditional token closely linked to TerraUSD. Both cryptocurrencies suffered losses of an estimated $40 billion or more when TerraUSD failed to maintain its $1 peg in May 2022.


The SEC alleges that Terraform and Kwon misled investors about the stability of TerraUSD and misrepresented how a popular Korean mobile payment app utilized the Terraform blockchain for transaction settlements.


In a ruling last month, Judge Rakoff determined that Terraform and Kwon violated U.S. law by not registering TerraUSD and Luna. Kwon also faces related U.S. criminal charges and an extradition request from South Korea, having been arrested in Montenegro last March.


The case is SEC v Terraform Labs Pte Ltd et al, U.S. District Court, Southern District of New York, No. 23-01346.